There is no doubt that the home buying process can get a little hectic. There are so many homes to look at, factors to consider, and papers to sign that even experienced home buyers can get a little overwhelmed. The tips below should help you get into that home of your dreams with the least amount of headaches and worries. Continue reading →

Private Mortgage Insurance (PMI) is a financial instrument that can be used by potential homebuyers to get into a home that they, otherwise, would not be able to afford. Basically, PMI acts as a safety net for lenders who want to process a loan for a borrower who does not have the 20 percent down payment that is usually required to qualify for a mortgage. This insurance is typically used by first time home buyers and can get a qualified borrower into a home with as little as 3-5 percent down. Continue reading →

One in 3 buyers are willing to bid higher than a home’s asking price, according to a survey conducted by Trulia in partnership with Harris Interactive.

That was just one of several other findings of the survey that appear to show that homebuyers are feeling the squeeze of market conditions that are significantly altered from those of a year ago. At the same time, they capture improved sentiment towards the housing market.

Today’s tight home inventory appears to be pushing some buyers to use aggressive tactics to beat out competing buyers, the survey found. In addition to a third of buyers being willing to make above-market offers, 1 in 4 said that they would offer to pay a seller’s closing costs.

“Tight inventory means slim pickings for buyers. Even though inventory is starting to expand, and rising home prices should bring more for-sale homes onto the market, people who actually want to buy within the next year are feeling the pressure of competing buyers and limited inventory,” wrote Trulia Chief Economist Jed Kolko in blog post about the survey.

Also seemingly a symptom of today’s limited housing stock, homebuyers who plan to buy within the next year said that finding a home that they like is their biggest worry.

And highlighting two other defining characteristics of today’s market, consumers who said they might buy someday indicated that their two greatest fears were that mortgage rates and home prices would rise further.

But in a sign that people’s attitudes towards homeownership have recovered significantly since the downturn, 60 percent of respondents said that they thought homeownership is one of the best long-term investments they could make, up from 47 percent two years ago.

“Summer’s end may have led to the close of a strong home-buying season, but a decrease in distressed sales is helping prices maintain their yearly gain and some regions are still experiencing monthly price increases.

As of August 23, 2012, prices fell 0.4 percent in 25 major U.S. metropolitan areas from July 23, 2012, according to Radar Logic’s RPX Composite price. Year-over-year, prices were still up 4.5 percent, and year-to-date, the RPX composite showed prices have risen 12.8 percent, the largest increase for the period since 2005.

When Radar Logic broke down the data based on region, a more complex picture was painted.

“There was considerable variation in price performance from region to region. In some areas prices have clearly peaked for the year and are now declining, while in others prices are still rising,” the real estate data provider said in its monthly housing report.

The Midwest and the West saw monthly price gains and rose 2.5 and 1.2 percent, respectively. In the South, prices were flat, increasing just 0.1 percent. Radar Logic said the South may have reached its seasonal peak and begin its seasonal descent. The Northeastern housing market brought the RPX Composite price down month-over-month with its 3.1 percent descent…”

Eight things to know about buying a home today

The home-sale market is showing signs of life. More buyers are confident now than they were a year ago that now might be a good time to buy. Interest rates are near all-time lows and home prices in some areas are back to 2002-2003 levels.

Some analysts are finally suggesting that we may be headed for recovery. If you have a secure job, plan to stay put and feel this is the right time for you to buy a home, consider the following.

In most places in the country, home prices are still declining. It has only been recently that the market picked up and it’s too soon to know if this will result in a sustainable increase in prices.

Job growth in some areas combined with low inventory of good homes for sale has resulted in multiple offers with buyers bidding the price up sometimes hundreds of thousands of dollars over the asking price.

In other high-demand, low-inventory areas, buyers may find themselves in a bidding war. This doesn’t necessarily mean that the price will be bid up significantly over the asking price. This will vary from one listing to the next depending on property location, condition, and price.

It’s important to research the local community where you want to buy. Find out what homes are selling for, if multiple offers are common and if listings are selling for more than the asking price. This will help you make a realistic offer that might be accepted when you find a home you’d really like to buy. It helps to work with an experienced local real estate agent.

Some sellers in high-demand niche markets intentionally list their home at a low price hoping to stimulate multiple offers. If you see such a listing and there are a lot of buyers wanting to make offers, you will be better able to know how high your offer would need to be to win the contest if you have done your due diligence.

HOUSE HUNTING TIP: Whether you’re anticipating competition or not, you should be preapproved for the mortgage you’ll need to complete the purchase before you write an offer. In competition, this will make a big difference, particularly if everyone else who is offering is preapproved. It also lets you know what you can afford. And, it puts you in a good bargaining position with the seller.

Buyers aren’t the only participants in the housing market that have heard the news that the market has improved. Some sellers are putting their homes on the market because they’ve been waiting for a better time to sell. This is good news for buyers looking in low-inventory markets.

You should expect that you will have to negotiate. Many of today’s sellers are selling for less than they paid. Even though the market has improved a bit, sellers may be disappointed with the current market value of their home. Be prepared to negotiate, not just the initial price, but after inspections are completed if items come up that you hadn’t anticipated.

Include realistic contingency time frames in your purchase contract for loan and appraisal approval if you’re applying for a mortgage. The recent uptick in the market means that lenders are suddenly overwhelmed.

THE CLOSING: Underwriters could require that additional conditions be met before you can be approved. Act quickly to avoid further delay.

Dian Hymer is a real estate broker with more than 30 years’ experience and is a nationally syndicated real estate columnist and author.

Local pending home sales up 12.3%

“San Diego County pending home sales rose 12.3 percent in April from year-ago levels as completed sales nationally increased nearly as much.

The chief economist for the National Association of Realtors, Lawrence Yun, interpreted the results as indicative of demand extending beyond the investor community looking for bargains in the still-depressed housing market.

“A return of normal home buying for occupancy is helping home sales across all price points, and now the recovery appears to be extending to home prices,” Yun said.

The San Diego Association of Realtors said there were 5,697 pending sales as of Tuesday, up slightly from 5,654 a month ago and up 12.3 percent from 5,075 a year ago…”

Is the spring homebuying season heating up?

Last month, San Diego County saw its highest home-sale count for a March month since 2006 as it entered another spring home-buying season, Tuesday’s numbers from DataQuick show.

A total of 3,237 homes were sold in March, up 19.5 percent from February and up nearly 6 percent from a year ago. Big percentage bumps are natural from February to March throughout Southern California, historical records show, but it appears this is the best March San Diego County has seen in six years, when a total of 4,367 homes were sold.

Improvement aside, sales are still far below from pre-recession levels. The current housing cycle’s peak was 6,926 transactions in June 2004.

“The year is young and lots could still change,” said DataQuick John Walsh in the company’s latest Southern California report. “But the results from the first big sales month of 2012 suggest the market is stuck in low gear. This remains a very gradual – not to mention fragile – recovery.”

Sales saw the most oomph in the markets of single-family resales and new properties, in which tallies increased almost 10 percent and 27 percent, respectively, from a year ago. However, both submarkets saw their values in March fall from a year ago. Prices for single-family resales dropped 4.2 percent to $350,000, and almost 26 percent to $392,000 in the new-home market…

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About John A Silva

As your local real estate adviser in the area of San Diego County with over 27 years of experience, my goal is to provide you with relevant local housing market information, tips, and advice.

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